KLS, Gogte Institute of Technology

Department of MBA
SUMMER INTERNSHIP PROJECT (SIP) 20MBA303 (2021-22)
Internal Viva Voce Examination
A PRESENTATION
ON
Credit Evaluation on Loans and Advances

Alihaanjum S Nadaf
USN:2GI20BA009
Contents
• Industry profile
• Company profile
• Vision, mission, Quality Policy
• Need for study
• Objective of the Study
• Scope of the study
• Limitation of the study
• Research design
• Theoretical background of the study
Analysis and
Interpretation oftge study

Findings

Suggestions

Conclusions
Industry Profile
• Bank in India started during last decade of 18 century
• Founded in 1770 and closed from 1829 to 1832, and the Indian General Bank, founded in 1786 but which
failed in 1791.
• In 1809 he was renamed Bank of Bengal.
• Bombay Bank in 1840 and Madras Bank in 1843. In 1921, three banks merged to form the Imperial Bank of
India.
• In 1955, the Bank presidency played a role in India. Until the creation of the Reserve Bank of India in 1935
at the Reserve Bank of India
• The Indian banking sector is generally classified as planned and unplanned
• The Banking Regulation Act of 1949 and an unregistered commercial bank.
• The government has developed an initiative to expand its branch network through the State Bank of India and
manage it through a National Bank for Agricultural and Rural Development (NABARD), with facilities such
as microfinance.
Company Profile
• In the year 1963, under the stewardship of Late Shri Chandrappanna L Pattanshetti as a founder Chairman.
• The Merchant’s Co-Operative Bank Ltd, established with an object to serve the business community.
• the Bank was renamed as “Shree Basaveshwar Co-operative Bank Ltd, in the year 1977.
• the bank obtained License from the Reserve Bank of India on 12th September 1986 vide License
No.UBD.KA 552 P .
• In the Process, the development of Bank was on its heel and growth in Deposit front started zooming up,
while lending process slowed down, due to reduced demand from large borrowers.
• Understanding, the need of proper lending and investment, the then Board of Directors.
• Took initiation from all directions for not only for disciplined lending and investments, but also for overall
development of the bank
• The Bank is proud to place here, that full computerization of all banking services was commenced in the year
1998, being the first bank in the Belgaum city.
 VISION, MISSION AND QULITY POLICY:

VISION
 Vision augments the socio-economic development of the district within the frame work of co-operative spirit
principles.
 Keeping mind decreasing poverty
 Unemloyeement and improvement backwardness ,maximum possible of economic development in district Bidar
model of SHG [[Self Help Group]
MISSION
 
 To achieve profit with growth by developing banking habits rural people
 To act as a balancing centre between societies and branches and to finance The co-operative
societies
 To provide financial assistance to poor and downtrodden people.
 To encourage thrift and collect savings from members and others.
 To develop, assist, help and co-ordinate the work of afflicted societies.
 To develop the co-operative societies.
 WTO [world trade organization] involves people in the formation
 Managing of the to bank, to assist a needy person for his all round
 Development of the family and village
 
 QUALITY POLICY:

‟To aim at customer‟s delight by exceeding his expectations through an expectation blend of quality of service our products
and services that we provide”
 NEED FOR THE STUDY:
 The education has great significance and provides well benefits to various students who have work hardly or directly
indirectly interact with banks
 It is a beneficial to management of the banks or companies by providing crystal clear pictures
 Regarding important aspects like profit and losses of bank balance sheet and Profitability
 The study is also beneficial to employees and offers motivations by showing how activity they Are contributing for
company profit
 The depositors who are interested in depositing money for choose banks expected of the interest depending one bank
percentage will also get a beneficial by going through to study and can easily take a decision whether invest or not to
invest in the money for bank

 
 OBJECTIVE OF THE STUDY:

 To study the profits, deposites of bank for the last three years
 To study the various loans and advances provided at basaveshwar bank
 To analyse the load and advances granted for the 3 years
 To examined the credit evaluation of loans and advances and give suitable suggestions on it
 
 SCOPE OF THE STUDY:
 The scope the study concerned with to the Basaveshwar BANK
 The present study “ANALYSIS ON LOANS AND ADVANCES” is empirical and description in nature.
 The study title is loans and advances on main branch Basaveshwar bank Belgaum. Based on the data and
information given by the bank
 The study is limited only to Basaveshwar bank Belgaum branch and considered only that branch activities.
 
 
 
 LIMITATIONS OF THE STUDY:
The present study has been conducted based on the following limitation
 The current study is limited to Belgaum district
 Time is important limitations. The whole study was conducted is in a period of time
 Loans and advances is based on understand easy to calculate. Therefore, there has been tendency to
over the agriculture loans detail.
 loans and advances is a based information on the preparing for bankers in balance sheet for the account
holder monthly installments and rate of interest collect the data for bankers in guiders for the bankers
banks for RBI bank for rules and regulations for the
,and the every bankers bank for RBI bank.
 
 LITERATURE REVIEW:

Balister et al. (1994) conducted a study of overdues of loans in agriculture to examine the repayment performance of
defaulters in three blocks of Agra district in Uttar Pradesh. They found that well-to-do agriculture families accounted
for a large share of overdues. They accounted 37 per cent of total defaulters and 57 per cent of total overdues. Total
amount of overdues and its relative share also increased during the period of study. Lack of proper supervision over
end use of loan was identified a major reason for mis-utilisation of credit which leads to increase in overdues

Ramachandaran (1992), in his paper titled, “Profit Planning as a Management Tool for Profit Maximisation” tried
to analyse profitability position of the banks. Increasing emphasis on goals, increase in establishment cost, NPAs,
amount locked in sick units, unfavorable deposit mix, compliance to statutory requirements were some reasons, 26
identified by him, for declining profitability. He suggested the following measures to redress the said problem: (i)
Diversification of business, (ii) Interest to be paid by RBI on CRR/SLR balances, (iii) Opting utilisation of scarce
resources by asset management, (iv) Better funds management, (v) Management of non- performing advances, (vi)
Professionalisation of bank management, (vii) Identification of loss centres, (viii) Better role of government, and (ix)
Upgradation of skills and mechanism.
RESEARCH DESIGN
Data collection is a most essential aspect of any research the whole result depends on the data collected and
information processed hence. The methodology adopted by me to collect the data is through primary and
secondary data, will be helpful for final interpretation.
There are two types of data collected
1) Primary data
2) Secondary data
 
 
 THEORETICAL BACKGROUND OF THE STUDY:
  CREDIT EVALUATION:
Credit assessment and approval is the process that a business or individual must succeed in order to qualify for a loan over a
long period of time or to pay for goods and services. It is also the business or lending institution that you use to assess
your credit needs.
The credit report also provides a number of other information. The credit report is useful for identifying the current
credit situation of potential borrowers and information on all current sources of borrowing and debt of borrowers around
the world.
LOANS AND ADVANCES LOANS
Loans are one of the types of services that banks offer to their clients in order to meet the needs that benefit the bank by
obtaining the appropriate interest rate.
Loans are only granted for a certain period. Generally, banks offer short-term loans. The total amount is also available
as a lump sum or installment. The property is exchanged or granted for different types of property, plant and equipment.
Goods, debts, financial products, real estate, automobiles, consumer sustainability, etc. Long-term loans are provided for
long-term loan acquisitions.
ADVANCES
 
Loans are a single credit facility set by the bank. Banks grant customers advances for temporary purposes, such as
buying commodity exchanges and collecting other low- performing commercial responsibilities. Loans are short-term
funds that banks provide to their clients. The money is repaid in installments and the interest rate is also higher than the
loan.
ANALYSIS AND INTERPRETATION OF THE DATA
Graph: 1 showing growth rate of vehicle loan
1.Vehicle loan
Table: 1 Calculation of the growth rate of Vehicle Loan

Vehical loan
120
Years Loan (Rs in lakhs) Growth rate (%)
100
2017 75.64 Nil 80
60
2018 84.56 11.58 40
20
2019 88.25 2.90 0
2017 2018 2019 2020
2020 89.75 1.52
Loan (Rs in lakhs) Growth rate (%)

    ∑x/n=17

Mean =∑x/n=17/4=4.25
 Housing loan
Showing growth rate of Housing loan
Table: 2 Calculation of the growth rate of Housing loan

Years Loan (Rs in lakhs) Growth rate (%) Housing Loan

2017 38532.33 Nil 30000
 
2018 37985.33 -1.91 20000
 
2019 37000.25 -3.50 10000
 
2020 37800.35 1.94 0
    ∑x/n =-2.47 2017 2018 2019 2020
-10000

Mean ∑x/n=-2.47/4=-0.63 Loan ( Rs in lakhs) Growth rate (%)

 Showing growth rate of Education Loan

1.Education Loan
Table: Calculation of the growth rate of Education Loan

Years Loan (Rs in lakhs) Growth rate (%)

Education Loan
2017 752.25 Nil
1400
2018 882.20 40.58
1200
2019 898.20 1.62 1000

2020 1080.90 16.30 800

600
    ∑x/n=70.5
400

200

0
Mean =∑x/n=70.5/4=17.62

2017 2018 2019 2020

Loan ( Rs in lakhs) Growth rate (%)

 Gold loan Showing growth rate of Gold loan
Table: Calculation of the growth rate of Gold loan

Years Loan (Rs in lakhs) Growth rate (%)

Gold Loan
2017 3545.25 Nil

2018 1932.25 -35.48 I 5000

4000
2019 2254.25 10.98 3000
2000
2020 2393.25 4.27
1000

    0
∑x/n=-20.23 2017 2018 2019 2020
-
1000 (%)
Growth rate Loan ( Rs in lakhs)

Mean =∑x/n=-20.23/4=-5.05
 FINDINGS
 
 The Belagavi Shree Basaveshwar Co-operative Bank Limited is best placed to meet the
needs of customers and their needs.
 Dividends and advance payments increase each year.

 The Belagavi Shree Basaveshwar Co-operative Bank Limited will increase each year by
providing loans and loans.
 Interest rates that provide deposits and loans to various customers in the income group.
 The Bank has established a Balance Sheet Management Committee for asset and liability
management purposes and adheres strictly to RBI's guidelines for ATMs.
 SUGGESTIONS
 
1. The bank must grant loans to avoid any repayment and know the solvency of the customer before making a loan.

2. You must inform your bank of the obligation to return the money you have borrowed. The borrower must be informed of the
different loan and loan collection protocols at the time of the loan.

3. Evaluation techniques used in the ALTMAN-Z SCORE analysis is a better way to determine the creditworthiness of the
borrower. The bank must inform the bank of this fact to reduce the risk.

4. The Belagavi Shree Basaveshwar Co-operative Bank will conduct detailed research on the borrower and the various risks
before approving the loan.

5. Loans should be provided at low rates and in sufficient quantities for all kinds of people to do so and save money in the bank.
6. A bank that maintains sufficient cash balances to maintain a better liquidity position.
7.  
8. The bank must provide the bank with more ATMs and other banking services.

9. The bank must increase the number of branches in other regions and increase the facilities available to customers for future
growth.

10. The bank should focus on providing additional services to existing customers other than banking services.
 CONCLUSION
 
Loans and loans play an important role in the financial performance of the bank's long-term growth. Banks
should focus on reducing the risks associated with loans and loans. The lower the level of risk, the higher the
profits of the bank. The higher the risk, the lower the profits of the bank.
There is a wide range of loan and loan components in India, particularly in the small business lending and
housing construction sectors. Banks must adopt a dynamic and innovative credit system. The study concluded
that various types of lending and borrowing functions are superior in all areas. The study concluded that loans
and loans granted by banks for housing construction and SME loans are increasing every year.
Identify the risks and assess the risks of good decisions. The bank can then decide to lend . it to the company or
individual. You must then adjust the appropriate interest rate based on the borrower's rating. Banks focus on
measuring credit risk. Connect with various bank borrowers. For this purpose, the primary valuation variable of
the bank is used as the predictor variable. It's difficult to say decisively. An approach is best suited for predicting
defects, and each approach has its advantages and disadvantages.
In conclusion, the management of loans and loans must be carried out appropriately to provide services to
customers and recover in time to maintain a good reputation with customers .